Choosing drug of choice from restrictive formulary.
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This article examines the cost effects of a closed pharmaceutical formulary on Medicaid expenditures for peptic ulcer disease. Studies were performed before and after the imposition of a closed pharmaceutical formulary and indicated that total Medicaid costs for peptic ulcer treatment were 15.0% lower during the closed formulary than open formulary periods. The overall savings were due mainly to a sharp decline in the number of peptic ulcer patients served by Medicaid. The cost per patient-month of therapy increased by 9.4% between study periods. Pharmaceutical costs per patient-month declined by 78.9%, monthly physician payments increased by 3.1%, and monthly inpatient hospital costs increased by 23.6%. The small, short-term savings may be negated by increased expenditures in the near future when sicker patients, previously denied peptic ulcer drug treatment, may reenter the Medicaid system in need of expensive inhospital treatment.
The effects of removing propoxyphene napsylate products from the Wisconsin Medicaid drug program formulary were examined. Internal analgesic expenditures and usage data for 3-month periods before and after the removal were compared (April through June 1984 versus the same period in 1985). After adjusting for price and reimbursement changes between the two study periods, overall expenditures were slightly higher after removal of these products. Expenditures per recipient, prescription, and unit all increased, as did the number of prescriptions per recipient. Expenditures, prescriptions, and recipients increased more for propoxyphene hydrochloride products as substitutes for propoxyphene napsylate products than for products in any other category. Increases also occurred for nonsteroidal anti-inflammatory products, suggesting they may have been chosen as replacement therapy. The proportion of napsylate prescriptions converted to hydrochloride prescriptions was larger for institutional patients than for noninstitutional patients. Although program expenditures did not decrease, as intended by the formulary change, other qualitative outcomes also should be considered, such as any therapeutic advantages the replacement products may have had for the patients.
This study examined the role of various policies (drug product substitution laws) that are usually motivated by cost containment objectives of insurers in facilitating entry by generic firms. Using data for six Canadian provinces over the years 1981-1988, we evaluated the impact of specific aspects of substitution laws on the level of generic use. We find that formularies and the passage of time are not significant determinants of substitution levels. Legal liability, mandatory product selection, deductible and co-payment schemes, and consumer awareness were found to be important variables. Price responsiveness of generic drugs is indicated but the evidence is not strong.
OBJECTIVES: The authors compare the extent and nature of triazolam use before and after its deletion from a health maintenance organization's (HMO) open and advisory-type drug formulary. METHODS: Benzodiazepine dispensings of HMO members were collected for the 3 years before (1989-1991) and for the 2 years after (1992-1993) the deletion of triazolam from the HMO's drug formulary. The number of triazolam users, their sex and ages, total annual exposure, estimated daily doses, and total days of annual exposure were calculated and compared before and after its deletion from the formulary. RESULTS: From being the most frequently dispensed short-acting benzodiazepine in the HMO in 1989, the prescribing and use of triazolam decreased tenfold by the end of 1993. The effect on who was using the drug and how it was being used was less dramatic. The elderly were frequent long-term users and had the longest exposure to the drug. CONCLUSIONS: An open and advisory-type formulary can affect providers' drug selection behavior.
BACKGROUND: Each province in Canada independently assesses drugs for their reimbursement eligibility. Publicly funded access to specific drugs is therefore dependent on province of residence. OBJECTIVE: Evaluate the variability of access and its determinants for publicly available prescription drugs across Canada, and discuss the feasibility of implementing a national plan. METHODS: For a sample of 58 drugs receiving Health Protection Branch approval in Canada between 01/01/1996 and 12/31/1997, all provinces were surveyed about their formulary inclusion/exclusion decision. Kappa values were estimated to measure concordance between provincial coverage decisions. Logistic analysis using Generalized Estimating Equations was used to assess the impact of key features of provincial plans on the decision. RESULTS: Among the 58 drugs, 5 (9%) were included in all 10 and 14 (24%) by at least 8 provincial formularies. None were excluded by all the provinces. Concordance rates among provinces were low (overall kappa-like statistic = 0.20 and range of pairwise kappa = -0.11 to 0.64). Logistic regression showed that therapeutic category, price ratio to comparator, the integration of public with private coverage, and the existence of ability-to-pay criteria were significant determinants of the inclusion decision. CONCLUSIONS: Findings show that public access to the same prescription medications differs widely across provinces. If Canada were to adopt a "National" plan without disrupting current individual prescriptions, all currently funded drugs in each province would have to be "grandfathered" and included in the new National formulary. Such an all-inclusive list would also make such a plan unaffordable.
BACKGROUND: In response to rising prescription drug costs, plan sponsors are increasingly implementing three-tiered pharmacy benefits. OBJECTIVE: This study examined the effect of a three-tiered pharmacy benefit on pharmaceutical utilization and expenditures, medication continuation, and use of other medical resources in a population of continuously eligible, commercially insured enrollees of a preferred provider organization (PPO). RESEARCH DESIGN: A quasi-experimental prepost with comparison group design was used. The pre- and postperiods were each 12 months long. SUBJECTS: The intervention group included enrollees whose employer moved from the PPO's two-tier benefit to a three-tier benefit (n = 6881). The comparison group included enrollees whose employer remained under the PPO's two-tier benefit (n = 13,279). MEASURES: Key dependent variables included total prescription claims and costs, net costs (total minus copay), medication continuation, office visits, and inpatient and emergency room use. RESULTS: Relative to the comparison group, the intervention group experienced lower prescription utilization and expenditures and reduced net costs. Medication continuation rates were lower at 6 and 11 months in one of four chronic therapy classes examined; however, discontinuation could not be clearly linked to tier-three medication use. No significant differences in physician office visits, inpatient, or emergency room use rates were found. CONCLUSIONS: Three-tier prescription copays can control drug costs without evidence of change in use of other medical resources in the year following implementation. Future research should examine a variety of three-tier designs.
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The article describes Fairview Health System's participation in the Institute for Healthcare Improvement Breakthrough Series on adverse drug events and medication errors. Fairview commissioned an interdisciplinary team to design, plan, and lead activities focused on reducing adverse drug events and medication errors. This team managed, facilitated, or led 15 separate projects, each focusing on a specific aspect of the medications process. Specific systems improvements were identified, leading to reductions in errors or adverse events. As a result of this effort, Fairview has committed to a long-term plan to reduce the risk of adverse drug events and medication errors to the lowest possible rate.
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BACKGROUND AND OBJECTIVE: Health plans are increasingly using more open drug formularies that offer differential prescription copayments as an incentive to enrollees to use brands that plans prefer. How much this financial incentive affects use of preferred brands has not been widely reported. The aim of this study was to estimate the effect of tiered copayments on the choice between preferred and nonpreferred brand medications. MATERIALS AND METHODS: Longitudinal logistic regression analyses of pharmacy claims from 1998 and 1999 comparing concurrent groups that were or were not exposed to tiered copayments. SUBJECTS: Enrollees in four independent physician practice association model health plans who had pharmacy claims for angiotensin converting enzyme inhibitors (ACEI), proton pump inhibitors (PPI), or hydroxymethylglutaryl coenzyme A reductase inhibitors (STATINS). OUTCOME MEASURE: Change in the percentage of prescription claims that were for preferred brands. MAIN RESULTS: Regression adjusted estimates of the average net increase in the percentage use of preferred brands of ACEI, PPI and STATIN from first quarter 1998 to third quarter 1999 attributed to tiered prescription copayments were 13.3 (P = 0.001), 8.9 (P = 0.03), and 6.0 (P <0.001) percentage points, respectively. CONCLUSIONS: Tiered prescription copayments were associated with a significant shift from nonpreferred to preferred brand medications. This type of financial incentive can help purchasers providing open access drug benefits by steering use of medications toward lower cost brands. The clinical effects of changes in medication use brought about differential copayments warrant further investigation.
OBJECTIVE: The objective of this study was to contrast experiences and opinion of providers in military treatment facilities, where a single formulary is used, with those of community providers where multiple formularies and preferred lists are commonly encountered. STUDY DESIGN: We conducted cross-sectional surveys. SETTING: The study was conducted at military and community practices that serve military beneficiaries. PARTICIPANTS: We studied randomly selected clinicians, stratified by military treatment facility (MTF) size or number of military beneficiaries served. The final samples included 566 eligible MTF and 557 private clinicians, with 69% and 38% response rates, respectively. OUTCOME MEASURES: We wanted to determine experiences with and opinions of formularies and/or preferred lists and related policies. RESULTS: Sixty-three percent of military providers were very familiar with formulary content and 60% with nonformulary request procedures; 67% thought their formulary was up-to-date and 84% felt Pharmacy & Therapeutics (P&T) committees were responsive to providers. In contrast, 23% of community providers felt very familiar with (multiple) formulary content and 10% with nonformulary request procedures. Only 15% perceived that formularies were current and 34% thought P&T committees were responsive to providers. Statistically significant differences remained after analysis of potential bias. CONCLUSIONS: Community providers were less aware and less satisfied with pharmacy benefits management policies than military providers, likely as a result of their daily interactions with multiple, unrelated pharmacy management systems. Addressing the problems expressed by community providers is imperative for pharmacy benefits managers.
The Veterans Health Administration (VHA) runs the largest integrated healthcare system in the nation. Formulary management within VHA primarily involves 3 national groups: the Medical Advisory Panel, the Veterans Integrated Service Network Formulary Leaders, and the Pharmacy Benefits Management Strategic Healthcare Group. Together, these groups manage the VHA national drug formulary with a goal of providing a comprehensive, safe, and cost-effective pharmacy benefit for veterans. Traditionally, VHA has relied on cost-minimization analyses in formulary decisions. More recently, VHA has emphasized the use of cost-effectiveness data, especially for newer, costly drugs. In addition to including this data in drug monographs, the VHA has begun requiring formal cost-effectiveness analysis from manufacturers of selected pharmaceuticals. VHA has also requested that clinically relevant information such as quality of life plus mortality benefit be made available from industry so that internal cost analyses can be performed. It is hoped that by setting the expectation that cost-effectiveness will be formally considered in all VHA formulary decisions, the pharmaceutical industry and others will be stimulated to collect and report data that enables these analyses. We believe that if other organizations also place an emphasis on economic evaluations, industry and the public will be more accepting of decisions that incorporate cost considerations.
Managed care plans have traditionally resisted using economic evidence explicitly in drug formulary decisions, even as they used ever more aggressive and sophisticated processes for managing care. In recent years, this has changed as health plans have begun to adopt evidence-based and value-based formulary submission guidelines. The guidelines have the potential to serve as a national unifying template for pharmacy and therapeutics committees to consider clinical and economic information in a systematic and rigorous fashion. However, many questions remain about their use and about the nature of communications (called "unsolicited requests") from plans to drug companies for information. This article describes the unsolicited request process and its potential impact on the use of economic evidence in formulary decisions.
This paper presents an analysis of usability of mobile prescription reference systems in medical practice, and presents implementation of mobilePDR (Physician's Desk Reference). Various aspects of mobilePDR are discussed: main functions, information content, performance and design issues, independent evaluation with other similar tools, and lessons learned from the system development.
OBJECTIVE: To identify economic and organizational characteristics that affect the likelihood that health maintenance organizations (HMOs) include new drugs on their formularies. DATA SOURCES: We administered an original survey to directors of pharmacy at 75 HMOs, of which 41 returned usable responses. We obtained drug-specific data from an industry trade journal. STUDY DESIGN: We performed multivariate logistic regression analysis, adjusting for fixed-drug effects and random-HMO effects. We used factor analysis to limit the number of predictors. DATA COLLECTION METHODS: We held initial focus groups to help with survey design. We administered the survey in two waves. We asked respondents to report on seven popular new drugs, and to describe a variety of HMO organizational characteristics. PRINCIPAL FINDINGS: Several HMO organizational characteristics, including nonprofit status, the incentives facing the director of the pharmacy, size and make-up of the pharmacy and therapeutics committee, and relationships with drugs makers, all affect formulary adoption. CONCLUSIONS: There are many organizational factors that may cause HMOs to make different formulary adoption decisions for certain prescription drugs.
The Medicare Part D outpatient prescription drug benefit will transform American health care delivery. In addition to increasing access to medicines, it will have a profound impact on physicians and drug developers. Senior citizens and other Medicare recipients will be forced to come to terms with a complex benefit structure and to make difficult choices. Physicians will have to help their patients navigate the new benefit as well as adjust their practices to deal with multiple formularies with different coverage policies. Medicare is creating a framework for collecting evidence, both from studies of comparative efficacy of drugs and from automated tracking of outcomes.
Prescription drug formularies are a key element in prescription drug benefit management. The use of formularies can both increase the quality of prescribing and reduce the costs of prescription drug therapy. The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 specified that an external agency, the United States Pharmacopeial Convention, Inc. (USP) through the Secretary of the United States Department of Health and Human Services develop model formulary guidelines for prescription drug plans. The model formulary guidelines are to assist individual drug plans in developing formularies that would qualify for participation in the Medicare Part D prescription program. The guidelines were developed through a Model Guidelines Expert Committee assisted by USP staff and following input from patient advocate groups, health care organizations, and pharmaceutical organizations over a period of 8 months (April 2004 to December 2004). The USP Model Formulary Guidelines organize prescription medications into 41 therapeutic categories (32 with associated pharmacologic classes and nine with no associated pharmacologic classes), 137 pharmacologic classes, and 146 unique therapeutic categories and pharmacologic classes.